Legislative Memos

Memorandum in Strong Opposition - S.6617-A (Avella) / A.8270-A (Englebright)

S.6617-A (Avella) / A.8270-A (Englebright) - AN ACT to amend the environmental conservation law, the public service law, the public authorities law, the labor law and the community risk and resiliency act, in relation to establishing the New York state climate and community protection act

The Independent Power Producers of New York, Inc. (IPPNY) is a trade association representing companies involved in the development of electric generating facilities, the generation, sale, and marketing of electric power, and the development of natural gas facilities in the State of New York. IPPNY represents more than 75 percent of the electric generating capacity in New York.

IPPNY strongly opposes S.6617-A (Avella) / A.8270-A (Englebright). This legislation would establish a goal of the State of New York to reduce greenhouse gas emissions from all anthropogenic sources by 100 percent below 1990 levels by the year 2050 (more than the 80 percent goal established pursuant to existing Executive Order), with an incremental target of at least a 50 percent reduction in climate change-related emissions by the year 2030 (more than the 40 percent goal pursuant to the most recent State Energy Plan). The bills’ provisions would apply to any source, capable of being measured, that the New York Department of Environmental Conservation (DEC) deems should be part of the program to help reduce greenhouse gas emissions in this state.

The electric generation sector already has reduced its greenhouse gas emissions the most of any other sector of the State’s economy – 51.7 percent below 1990 levels – largely as a result of the forces of the competitive wholesale electricity market and without the availability of direct emission control technologies. In-state independent power producers continue to provide reliable and low-emitting electricity supply at a time of near record low natural gas and electricity prices, all of which are a benefit to this state’s electricity consumers. This legislation would likely impair electric system reliability through essentially requiring a 100 percent renewable energy system by 2050 to satisfy the requirement that greenhouse gas emissions be reduced to zero by that point. It would result in the elimination of the gas-fired baseload electric generating facilities that are able to operate continuously to provide the reliable and low-cost electricity upon which the State’s energy consumers depend. Currently, 48 percent of the State’s electric generating capacity is produced by dual fuel (natural gas and oil) operations, and nine percent is generated using natural gas, along with six percent by oil. These dual fuel, natural gas, and oil facilities are the backbone of the reliable electricity supply in this state. The bills also would cause the elimination of gas-fired and dual fuel peaking facilities that are needed to maintain reliability on hot summer days and produce energy quickly to meet system requirements when intermittent solar and wind energy facilities are not operating because the sun is not shining and the wind is not blowing. In the New York City area, system reliability is maintained by 69 percent of the electric generating capacity operating in a dual fuel manner. Replacing all of the carbon dioxide (CO2) emitting generating facilities needed to maintain reliability and balance the energy provided by intermittent renewable resources with zero-emitting resources is likely economically infeasible due to the high costs of developing energy storage and other highly responsive resources with zero emissions in general.

The Governor has directed the DEC and the New York State Energy Research and Development Authority (NYSERDA) to undertake a comprehensive study to determine the "most rapid, cost-effective, and responsible pathway to reach 100 percent renewable energy statewide,” presumably with in-state resources. It would be rash to enact this legislation without appropriate studies demonstrating that a 100 percent greenhouse gas emissions reduction goal is economically and technically feasible.

There is no lack of regulatory authority or existing emission reduction requirements that needs to be addressed by this legislation. The DEC already has the authority, without this legislation, to update and implement the draft Climate Action Plan Interim Report, which was developed through an extensive stakeholder process, for how to reduce emissions from each sector of the State’s economy. This report arose from Executive Order #24, which already established the goal of having all sources within the State reduce greenhouse gas emissions by 80 percent below 1990 levels by 2050. Importantly, the report’s requirements already have been adopted, or are being implemented, for the power sector.

In August of 2016, the New York State Public Service Commission (PSC) adopted the Clean Energy Standard (CES), which mandates that electricity consumers fund the development of new renewable resources, built after January 1, 2015, to meet the goal that renewable generation provide 50 percent of the electricity consumed in the state by 2030. NYSERDA and the New York Power Authority already have issued Requests for Proposals to begin to implement the CES. Yet, this legislation also would require that, by January 1, 2018, the PSC establish a program to require that a minimum of 50 percent of the statewide electric generation secured by load serving entities to meet the electrical energy requirements of all end-use customers in New York State in 2030 be generated by renewable energy systems.

The ongoing State Resource Planning Study is evaluating the impact of this 50 percent requirement on electric system reliability. As a result, there currently is no clear path to maintaining reliable electricity under the 50 percent requirement, much less a 100 percent renewable energy requirement.

This legislation comes on the heels of the Governor's issuance of an Executive Order affirming New York's commitment to the standards set forth in the Paris Climate Agreement, as well as New York City Mayor Bill de Blasio's Executive Order committing the City to the Paris Agreement. The legislation also follows Governor Cuomo's announcement of the Methane Reduction Plan to reduce emissions from the landfill, oil and gas, and agricultural sectors across New York State.

New York State led the other states in the Northeast to adopt the Regional Greenhouse Gas Initiative (RGGI), which is a regional approach to reducing CO2 emissions from power plants. RGGI’s requirements actively are being reviewed again this year to make them stricter. The Governor has called upon the RGGI states to reduce greenhouse gas emissions by 2030 by at least an additional 30 percent below the current emission reduction requirement through 2020.

Additionally, the DEC already has adopted its CO2 Performance Standards for Major Electric Generating Facilities (for new power plants and increases in capacity at existing power plants) and its regulation for Analyzing Environmental Justice Issues in Siting of Major Electric Generating Facilities Pursuant to Public Service Law Article 10 (New York’s Power Plant Siting Law).

For the reasons stated above, IPPNY respectfully and strongly opposes the passage of S.6617-A (Avella) / A.8270-A (Englebright).